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Tying Up Land During Family Law Disputes

Tying Up Land During Family Law Disputes

In situations of divorce, the spouses strive after separation to unwind their financial (and emotional) affairs as quickly as possible. The process usually takes a while, and there are certain legal procedures and processes that facilitate the orderly resolution of issues as the matter progresses to trial. Some of these involve mechanisms to give the public notice of the imminent litigation, or to effect a temporary alteration or “suspension” of the rights of spouses or other individuals, pending the outcome.

A certificate of pending litigation (or lis pendens in Latin) is one of these mechanisms.

What is it? A certificate of pending litigation (or “CPL”) serves as a notice to the public that the interests pertaining to a certain piece of land (usually the matrimonial home) are currently subject to a court dispute. It is a temporary measure, is registered against the land, and is discharged once the litigation is resolved.

How is it obtained? Essentially, the party who wishes to have the benefit of a certificate of pending litigation (“CPL”) must show that he or she has a “reasonable claim to an interest in the land,” a fact that must be established on a balance of probabilities.

The party seeking the CPL must also satisfy certain legislated requirements (which are set out in the Courts of Justice Act and the Ontario Rules of Civil Procedure), as follows:

• to be effective, the CPL must be issued by a registrar of the court, pursuant to a court order;

• once the CPL has been obtained, it must be served on all parties against whom an interest in land is claimed in the proceeding; and

• it must be properly registered on title of the Ontario land in question, either under in Land Titles or Registry (as the case may be).

In addition to these requirements, the Courts of Justice Act also safeguards against the abuse of CPLs, by providing that any party who registers one without having the requisite reasonable legal claim to back it up will be liable for any damages that result. This is accomplished through the use of an “undertaking as to damages”: the person requesting the CPL must abide by any court-ordered damage award in the event that the registration of the CPL against the property unjustly caused damages to the party who owns the land, or to certain other persons.

Incidentally, there is no requirement that the person applying for the CPL has to give notice in advance of doing so (i.e. he or she may bring a “motion without notice” to the affected parties).
What does it do? Technically speaking, a registered certificate of pending litigation does not prevent the owner from dealing with or selling the land; however, most buyers will avoid transactions that are fettered in this manner.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at www.RussellAlexander.com.